Question 1

If the price level rises,the money demand curve will shift to the right.

Accepted Answer

A) True 
 B)False

Question 2

Which one of the following statements is correct?

Accepted Answer

A)  The lower the interest rate,the higher the opportunity cost of holding assets in the form of money. 
B)  A vertical money supply curve means that the quantity of money supplied is independent of the interest rate. 
C)  The larger the supply of money,the higher the interest rate,all things equal. 
D)  Travelers checks and government bonds are equally liquid assets. 
E)  The transactions demand for money increases whenever the price level decreases. 
A)  The lower the interest rate,the higher the opportunity cost of holding assets in the form of money. 
B)  A vertical money supply curve means that the quantity of money supplied is independent of the interest rate. 
C)  The larger the supply of money,the higher the interest rate,all things equal. 
D)  Travelers checks and government bonds are equally liquid assets. 
E)  The transactions demand for money increases whenever the price level decreases.

Question 3

If the money supply is $1,000,the price level is 3,and real income (or output)is $5,000,then the velocity of money is

Accepted Answer

A)  0.2 
B)  0.6 
C)  1.67 
D)  5 
E)  15 
A)  0.2 
B)  0.6 
C)  1.67 
D)  5 
E)  15

Question 4

The equation of exchange

Accepted Answer

A)  states that the price level times velocity equals GDP divided by the interest rate 
B)  states that total spending equals real GDP 
C)  states that money supply times velocity equals real GDP 
D)  is an identity,not a theory 
E)  becomes the quantity theory of money on the assumption that the price level is always constant 
A)  states that the price level times velocity equals GDP divided by the interest rate 
B)  states that total spending equals real GDP 
C)  states that money supply times velocity equals real GDP 
D)  is an identity,not a theory 
E)  becomes the quantity theory of money on the assumption that the price level is always constant

If the price level rises,the money demand curve will shift to the right.

Which one of the following statements is correct?

If the money supply is $1,000,the price level is 3,and real income (or output)is $5,000,then the velocity of money is

The equation of exchange

The Art and Science of Economic Analysis

Economic Tools and Economics Systems

Economic Decision Makers

Demand, Supply, and Markets

Introduction to Macroeconomics

Productivity and Growth

Tracking the US Economy

Unemployment and Inflation

Aggregate Expenditure

Aggregate Expenditure and Aggregate Demand

Aggregate Supply

Fiscal Policy

Federal Budgets and Public Policy

Money and the Financial System

Banking and the Money Supply

Macro Policy Debate: Active or Passive

International Trade

International Finance

Developing and Transitional Economies

Understanding Graphs

National Income Accounts

Variable Net Exports

Variable Net Exports Revisited

The Algebra of Income and Expenditure

The Algebra of Demand-Side Equilibrium

Filters

Exam 16: Monetary Theory and Policy

If the price level rises,the money demand curve will shift to the right.

Which one of the following statements is correct?

If the money supply is $1,000,the price level is 3,and real income (or output)is $5,000,then the velocity of money is

The equation of exchange

The Art and Science of Economic Analysis

Economic Tools and Economics Systems

Economic Decision Makers

Demand, Supply, and Markets

Introduction to Macroeconomics

Productivity and Growth

Tracking the US Economy

Unemployment and Inflation

Aggregate Expenditure

Aggregate Expenditure and Aggregate Demand

Aggregate Supply

Fiscal Policy

Federal Budgets and Public Policy

Money and the Financial System

Banking and the Money Supply

Macro Policy Debate: Active or Passive

International Trade

International Finance

Developing and Transitional Economies

Understanding Graphs

National Income Accounts

Variable Net Exports

Variable Net Exports Revisited

The Algebra of Income and Expenditure

The Algebra of Demand-Side Equilibrium

Filters